One of the most effective strategies to promote growth is expansion. It also carries a considerable risk by nature.
The choice to expand your business, regardless of industry, is not one to be taken lightly. Business owners often miscalculate the financial and other resources necessary to operate a second location. In fact, failing to take into account all of the costs and risks associated with the expansion might risk not only the success of the new location but also the company as a whole. Therefore, the following are some of the factors businesses should think about before starting to open a second location:
Establish specific objectives
Prior to expanding with a new location, it is crucial to have a clear plan in place, as with the majority of significant commercial efforts. Think about these questions:
- Is expanding primarily intended to adequately meet the demands of current customers or to enter a new market?
- Have you adequately considered alternatives to expand if your main objective with this is to properly meet the current demand?
- Is one of your main motivations for expansion the access to a new highly-skilled workforce? If yes, have you put in place sufficient hiring and training resources?
- Will the intangible benefits of branding and reputation outweigh your investment if your major purpose for expansion is to achieve them?
It will be simpler to achieve success if you define your company's expansion goals early on and continue looking into less expensive alternatives to expansion that might address the same issues.
Develop your brand
Being regarded as a global company has great prestige in several industries. This is especially true for businesses that offer professional services, such as law firms, accounting firms, and financial service providers. The prestige of being a global brand is often a key factor in these companies' choice to expand.
A trademark registration certificate will help you avoid a great deal of trouble if you wish to expand your company, especially globally, in the event that a competitor company decides to challenge your right to use a certain word, expression, or logo. You will have the exclusive right to use your company's or organization's name after your trademark is successfully registered. Your branding activities must include trademarks, and it is advantageous for you if consumers link your company or product with a memorable name and logo.
Remember to conduct compliance due diligence
Whether your second location is in a different city, state, or even a different country, be sure that you may legally offer your goods or services there and that they comply with all local regulations. Additionally, confirm that the new location complies with all tax and legal business structure regulations. It is also strongly advised that you register your trademarks and other intellectual property in the country where you are thinking about considering the expansion.
It should go without saying that one of the best strategies to promote growth for many businesses is through expansion. It also carries a considerable risk by nature. By considering all of the above, you will improve the chances of your second location's success.
Originally published September 17, 2022
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
